A company’s communication is significant to the overall development of its affairs. Businesses all across the globe work to foster strong professional relationships among the members and the directors of the company. The key word is teamwork, which is expected to be utilized for the company to get into business and succeed in the market.
One of the most vital duties of a company secretary is to send notice of the company’s meetings to persons required to attend. This article brings a clear understanding of the rules of notices and how they play to assist the company in attaining its objectives.
What are company notices?
Company notices are vital communications made to the members of the company’s general meeting and all other officers of the company entitled to attend a general meeting of the company. The notice of meetings is a significant part of the company’s meetings; a person entitled to receive a notice but doesn’t can have all that was decided in the meeting annulled- this in turn makes the meeting a waste of time for those that attended.
Timeframe for issuing notices
As stated previously, failure to issue notice to a person entitled can see the entire meeting and resolutions made thereof annulled. The Companies and Allied Matters Act (CAMA 2020) provides that the notice of meetings must be issued 21 days before the meeting. This invariably means that the notices must be issued within 21 days excluding the date of the meeting.
The notice can be issued at a longer date but cannot be issued at a shorter date from the 21 days provided by the CAMA 2020, except in the circumstances below.
Issuing notices with a shorter timeframe
A notice timeframe of 21 clear days as provided by the CAMA can be displaced. For this to occur, the type of meeting to be attended is vital to know how the notice timeline would be dispensed.
For the Annual General Meeting, all members of the company entitled to attend the Annual general meeting and vote must consent unanimously to having a shorter date of the notice.
For any other meeting, in unity holding 95% of the holders of the nominal paid-up share capital of the company.
Purpose of notice of meeting
Notices are required to offer members of the company ample time to study the necessary information about the agenda and the exact picture of what is to be disclosed. The general meeting of a company is usually scheduled to discuss a variety of items listed on the agenda of the meeting, aside from the ordinary business of the company which is contained in CAMA and is known to the majority of the members.
Nonetheless, certain special businesses unknown to the members must be notified to all members attending for such resolution made on such business to be effective.
Contents of a Company notice
One significant element of notice is that it acts as a ritual for the general meetings of companies and must be followed strictly. Meeting up with the timeframe for the meeting isn’t sufficient enough but also making sure that the notice contains all aspects that would sufficiently provide clarity to the members of the meeting is key.
All notices of meetings must contain the following:
- The Place of the meeting: This is the address where the meeting would be held. The address must be sufficiently stated so as not to confuse the members.
- The date and time: The date the meeting would be held is significant in several ways, one of which is it helps the members calculate the time for notice being 21 days. The time of the meeting must also be stated on the notice.
- The agenda to be discussed: this is perhaps the most significant reason for having a notice sent, the agenda to be discussed at the meetings must be known to all members voting at least 21 days before the meeting, this allows members to understand the politicking and factors involved in an issue before voting. the agenda must describe the item sufficiently and must state whether it requires a special resolution or an ordinary resolution.
Who should receive notice of Meetings?
The notice of meetings must be received by all who are expected to attend the meeting whether voting or not. The following are to receive the notice of meetings:
- Every member of the company: All members of the company are entitled to receive notice of meetings. A member of a company is a shareholder whose name is contained in the register of members.
- Persons to whom shares have devolved: These are persons who hold shares on behalf of shareholders that are minors, insane, incapacitated, dead and others; these persons include personal representatives, legal representatives, trustees, receivers and others.
- Every director of the company, including non-executive directors
- Every auditor of the company
- The secretary of the company.
Service of notice
Serving notice should be taken as significant as making it because service of notice speaks to receipt of the notice itself.
Notices are sent by the company to those entitled either personally or by post through the recipient’s registered address or any address provided to the company (email inclusive). When a notice of meeting is sent by post, such a notice would have been deemed to be sent after 7 days of the posting.
For public limited liability companies, aside from the notice given to those entitled to attend the meeting of the company; there must be an additional advertisement of the meeting in two newspapers 21 days before the meeting is held.
Failure to give notice
If notice is not sent to a person entitled to receive it, the entire activities, including resolutions made at the meeting would be invalid; except the person sending the notice can prove that the omission was an honest mistake.
Company notices are vital parts of setting a general meeting to motion. Without a duly sent notice, there is likely to be no meeting at the first instance. This article brings you up to date on the notices of meetings required in a company.
Frequently Asked Questions (FAQs)
A special notice is a 28 days notice required by CAMA for certain agendas.
Usually the duty of the company secretary, nonetheless, any worker of the company can be appointed to issue the notice.